How do I write off a vehicle purchased for business? Sched. C, I have a loan on it, so what amount can I deduct? The full amount of the loan or what I've paid so far?

[Marketstar · Accepted solution]

You may be able to depreciate the vehicle using the entire purchasing price-disregard the loan amount.

You can actually deduct 54 cents per mile (which will include depreciation) or actual vehicle expenses (ie. gasoline. oil, tires, maintenance) prorated for business miles.

If you claim the standard mileage rate in year one for this vehicle, you will have the option of deducting the standard rate or actual expenses in subsequent years. If you claim actual vehicle expenses in year one, you must choose actual expenses in every subsequent year for that auto.